Obama Keeps Hitting Wrong Note on the Economy
Against all odds, President Obama was elected president of the United States in large part due to his unflagging ability to stay on message. So why is he having so much trouble staying on message now? Enough of this overstated talk of a catastrophic economy and dire predictions of long, hard times. Americans need straight talk, true enough. But there's a difference between being honest and being such a naysayer that you end up discouraging the economic activity we so desperately need.
As Holman Jenkins points out in today's Wall Street Journal, in hindsight it was a mistake to get politicians running for office involved in the discussion of how to fix a banking crisis. But involved they did get, and in part because of that, here we are today, with many Americans scared witless about the future of the economy.
That's a very bad thing in terms of what it can engender since two-thirds of consumer spending make up our GDP. Now that Obama has his stimulus package, what he really needs to do is stay on message, assuring us that the stimulus and other measures being taken will work. He needs to put his arm around our shoulders and assure us he'll do whatever it takes, while at the same time asking for patience because change is going to take a while.
We'll argue for decades about whether the stimulus was really even needed. No matter what Obama says or does, he won't get the Republicans to quit nattering about the uselessness of the $787 billion in spending and tax cuts. They would do us a service if they'd stop talking the stimulus down, even claiming it will do more harm than good (It does, after all, include a huge tax cut). But they won't stop and Obama should just ignore them for a while. He's faced down this kind of endless backbiting before.Why should it bother him so much now that he lives at 1600 Pennsylvania Avenue? Obama also needs to stop sounding like a loose-lipped liberal who wants to fix all problems at once. That only creates a cacophony that drowns out the hopeful messages and contributes to the doom.
The banking crisis can be best fixed without the kind of kitchen table discussions that Obama loves. Let's face it: most of us are not interested about swap spreads, Basel I capital reserves or nominal pricing on derivatives. Even on the housing crisis, which is no small thing, the vast majority of the problems are confined to six states and even in those states, the problems are concentrated in a handful of counties.
While the economic statistics don't look pretty, we at Kiplinger still believe the economy will start to grow, albeit not by much, by yearend.
In the meantime, President Obama, you need to stay on Air Force One a lot, leading with confidence and comfort, not fear. Pretend you're still campaigning, if you have to.